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October 1, 2014

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Joe Downtown: Want a room at the Gold Spike? You might try booking it through Zappos

Image

Steve Marcus

The Gold Spike casino and hotel, seen from Fourth and Ogden streets, in downtown Las Vegas.

Gold Spike

A view of the Gold Spike hotel-casino in downtown Las Vegas Monday, Aug. 17, 2009. The Siegel Group has been renovating the hotel as well as the nearby Travel Inn. Launch slideshow »

Map of The Gold Spike

The Gold Spike

217 N. Las Vegas Boulevard, Las Vegas

Though Tony Hsieh doesn’t want to get into the casino business, sources say, he and a partnership of downtown investors now hold the note to the Gold Spike.

A local commercial real estate developer, who spoke on the condition of anonymity, said that means the Gold Spike’s owners, Siegel Group Nevada Inc., now make loan payments to Hsieh and his partners.

Hsieh, CEO of the online retailer Zappos, confirmed Wednesday that he and his partners own the note. Asked if that means he might eventually own the property, Hsieh replied he didn’t know.

“We are happy just being the debt holder but also always open to other discussions,” he said. For details, he referred questions to Andrew Donner, CEO of Resort Gaming Group and a partner with Hsieh’s Downtown Project in real estate acquisitions.

Via text message, Donner said he was out of the country and would provide details later this week.

A message left for a Siegel Group spokesman was not returned by the time this story was published.

This much is clear, though: Booking a room at the hotel beyond this weekend is no easy task.

The hotel’s website shows reservations available up to Sunday, April 14. The site says other dates are unavailable after that.

When the Sun called the property Wednesday to ask for reservations in October, the person who answered said the date was too far out to make a reservation; asked about a room over Labor Day weekend in September, the person said all the rooms were full. Asked for a date in mid-June, the person said the reservation system had suddenly gone out of order.

Siegel purchased the hotel, casino and some surface parking on about 1.5 acres over a period of time between mid-2007 and early 2008. The hotel reportedly sold for $5 million; the sale price for the casino isn’t listed in Clark County online records, though it reportedly went for as much as $21 million.

Since its purchase, Seigel has spent much time and money renovating the property, turning it into a “boutique” hotel. The casino and hotel together are known as the Gold Spike Hotel & Casino.

At the time of Siegel’s purchase, real estate values in Las Vegas were unusually high. But values decreased rapidly downtown and all over the valley during the recession that began in late 2008. But downtown is bouncing back quickly due in large part to Hsieh's announcement he would be moving 1,300 Zappos employees from Henderson to downtown this fall.

Hsieh’s Downtown Project is also investing some $350 million in real estate, education, small businesses, entertainment and tech businesses. Real estate purchases downtown by Hsieh and partners have topped $100 million and total at least 50 acres.

Zappos is leasing Las Vegas’ old City Hall from Resort Gaming Group; the building, which will be Zappos' new headquarters, and its parking garage are directly north and adjacent to the Gold Spike.

Hsieh’s interest in the Gold Spike has been rumored since at least December. While he currently houses his numerous guests in the dozens of apartments he leases in the high-rise The Ogden, a block southeast of the old City Hall, housing those guests in the hotel might be considerably less expensive.

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